Anytime Fitness Terminates India Franchisee Agreement

After Anytime Fitness clubs closed unexpectedly in India, the Hastings, MN-based company cut ties with the master franchisee in that country.

The decision to end the agreement with Chandan Lunawat, chairman and managing director of Anytime India Fitness Private Limited, was made at the beginning of May, according to Anytime Fitness President and Co-Founder Dave Mortensen.

“We are extremely disappointed to learn of the recent closings of Anytime Fitness clubs in India,” Mortensen said in a statement. “This is an unfortunate development for the Indian fitness industry and for Anytime Fitness.”

All four Anytime Fitness clubs in India have closed, but the company considers them temporarily closed as it seeks alternatives to reopen them. Those alternatives include an acquisition by another club company or the assumption of the leases by a new master franchisee, says Mark Daly, company spokesperson.

According to an article from an Indian website, Lunawat closed his club in Kalyaninagar, India, on May 1. A notice posted at the club said the club would be closed for a week due to maintenance, but it has not reopened.

Lunawat announced his franchisee agreement with Anytime Fitness in December 2009. Since that time, however, Lunawat took liberties with the Anytime Fitness model and deviated from the company’s systems despite Anytime’s warnings, Mortensen said.

“As a result of these breaches, we delivered a notice of termination of our agreement to our master franchisee,” Mortensen said. “Regrettably, we were unable to apply resources from overseas to protect the numerous individuals that have been affected by this problem, including club members, staff, landlords, vendors, respected financial institutions and a prominent Bollywood celebrity.”

Any new Anytime Fitness clubs that open in India will be jointly owned and operated by Anytime Fitness and the new master franchisee, Daly says.

“We’re operating very successfully in 10 different countries currently using the standard master franchisee agreement,” Daly says. “This is the first time anything like this has ever happened where a master franchisee has not used the Anytime Fitness business model. We’re convinced that the Anytime Fitness business model can work in India.”